Hurricanes and floods accounted for 40% of the damages resulting from natural disasters during 2018 in the country, revealed the Mexican Association of Insurance Institutions (AMIS).

This type of risk refers to hurricanes, floods, rains, hailstorms, and mudslides, which are rising due to climate change, among others. Despite this, in Mexico, only 6.5% of homes are insured at the initiative of their owners, 5% of microenterprises, 15% of small companies and about half of the medium and large companies.

In 2018 five catastrophic events occurred in Mexico: hurricanes Bud and Carlotta that happened in June, in addition to Willa in October; the tropical depression 19-E in September and tropical storm Vicente in October.

For the 2019 hurricane season, which began in mid-May in the Pacific Ocean and June 1 in the Atlantic, it is expected the impact near 33 hydro-meteorological events in the country, according to the National Water Commission (Conagua). Of these, 14 would be tropical storms and the rest hurricanes, from category 1 to 5 on the Saffir-Simpson scale.

It is important to mention that there is still the false perception that strong natural disasters are sporadic; however, there are smaller events that have generated large losses and both the citizens and the uninsured local governments have to cover the cost of the damages.

In the face of these natural events, AMIS recommends identifying all the risks to which one is exposed and requesting the advice of a specialist in insurance (agent); Ask all the doubts and especially the scope of the coverage at the time of contracting the insurance.

It also suggests evaluating that the protection acquired (sum insured) is adequate to the risks that are to be covered; be clear when the coverage applies and when not (exclusions) and assess the amount of the deductible and co-insurance (amount with which the user contributes to cover the loss), among others.

"In spite of the unfortunate losses and the risk that these phenomena represent, low levels of insurance are still observed, especially in medium and small businesses located in vulnerable areas, such as coasts," said the Director General of the Association, Recaredo Arias.

During 2018, catastrophic damages caused by natural disasters cost 11,386 million pesos to the insurance sector, of which 4,633 million pesos corresponded to hydro-meteorological risks. Last year compensation was paid for 4,633 million pesos for these phenomena, while in 2017 the amount was 4.56 million, an increase of 14 percent. Damage premiums including hydrometeorological risks totaled 10,865 million pesos in 2018, while in 2017 the figure was slightly higher, with 10,870 million.